Derivatives

9 Months Ended

Sep. 30, 2025

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

Derivatives

Commodity Derivatives 

The Company is exposed to commodity price risk, which impacts the predictability of its cash flows from the sale of oil, natural gas and NGL. On occasion, the Company has attempted to manage this risk on a portion of its forecasted oil, natural gas or NGL production sales through the use of commodity derivative contracts.

Historically, the Company has not designated any of its derivative contracts as hedges for accounting purposes. As applicable, if the Company has open derivative contracts, the Company has recorded such contracts at fair value with changes in derivative contract fair values recognized as a gain or loss on derivative contracts in the condensed consolidated income statements. Commodity derivative contracts were settled on a monthly basis, and the commodity derivative contract valuations were adjusted on a mark-to-market valuation basis quarterly.

The following table summarizes derivative activity (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
(Gain) loss on derivative contracts	$	(2,364)	$	(1,866)	$	(5,936)	$	(1,866)
Settlement gains (losses) on derivative contracts	$	2,661	$	199	$	3,980	$	199

Master Netting Agreements and the Right of Offset. As applicable, the Company historically has had master netting agreements with all of its commodity derivative counterparties and has presented its derivative assets and liabilities with the same counterparty on a net basis in the unaudited condensed consolidated balance sheets. As a result of the netting provisions, the Company's maximum amount of loss under commodity derivative transactions due to credit risk was limited to the net amounts due from its counterparties.

Because we did not designate any of our derivative contracts as hedges for accounting purposes, changes in the fair value of our derivative contracts were recognized as gains and losses in the earnings of the relevant period. Changes in fair value were principally measured based on a comparison of future prices to the contract price at the end of the period and through the Black-Scholes or other similar valuation method in the case of options.

The following table summarizes (i) the Company's commodity derivative contracts on a gross basis, (ii) the effects of netting assets and liabilities for which the right of offset exists based on master netting arrangements, (iii) the financial collateral, if any, associated with the Company’s commodity contracts, and (iv) the Company’s net derivative asset and liability positions as of September 30, 2025 (in thousands):

	Gross Amounts		Gross Amounts Offset		Amounts Net of Offset		Financial Collateral		Net Amount
Assets (Liabilities)
Derivative contracts - current	$	2,760	$	344	$	2,416	$	—	$	2,416
Derivative contracts - non-current	78		339		(261)		—		(261)
Total	$	2,838	$	683	$	2,155	$	—	$	2,155

The following table summarizes (i) the Company's commodity derivative contracts on a gross basis, (ii) the effects of netting assets and liabilities for which the right of offset exists based on master netting arrangements, (iii) the financial collateral, if any, associated with the Company’s commodity derivative contracts, and (iv) the Company’s net derivative asset positions as of December 31, 2024 (in thousands):

	Gross Amounts		Gross Amounts Offset		Amounts Net of Offset		Financial Collateral		Net Amount
Assets
Derivative contracts - current	$	744	$	630	$	114	$	—	$	114
Derivative contracts - non-current	86		—		86		—		86
Total	$	830	$	630	$	200	$	—	$	200

As of September 30, 2025, the Company's open derivative contracts consisted of oil, natural gas, and NGL commodity derivative contracts as follows:

	Period	Index	Daily Volume	Weighted Average Price
Oil (Bbl)
Fixed Price Swaps
	October 2025 - December 2025	NYMEX WTI	500	$71.60
	January 2026 - June 2026	NYMEX WTI	300	$68.67
Producer Costless Collars
	October 2025 - December 2025	NYMEX WTI	675	$61.57 Put / $78.02 Call
Natural Gas (MMBtu)
Fixed Price Swaps
	October 2025 - December 2025	NYMEX Henry Hub	8,500	$4.17
	January 2026 - December 2026	NYMEX Henry Hub	4,500	$4.09
Producer Costless Collars
	October 2025 - December 2025	NYMEX Henry Hub	20,500	$3.79 Put / $7.08 Call
	January 2026 - December 2026	NYMEX Henry Hub	4,500	$3.35 Put / $5.35 Call
NGL (Bbl)
Fixed Price Swaps
	October 2025 - December 2025	Mont Belvieu OPIS - C3+(1)	300	$39.69
	October 2025 - December 2025	Mont Belvieu OPIS - Ethane(2)	325	$11.76

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(1) Excludes ethane.

(2) Ethane only.

As of December 31, 2024, the Company's open derivative contracts consisted of oil and NGL commodity derivative contracts as follows:

	Period	Index	Daily Volume	Weighted Average Price
Oil (Bbl)
Fixed Price Swaps
	January 2025 - December 2025	NYMEX WTI	500	$71.60
	January 2026 - June 2026	NYMEX WTI	300	$68.67
NGL (Bbl)
Fixed Price Swaps
	January 2025 - December 2025	Mont Belvieu OPIS - C3+(1)	300	$39.69

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(1) Excludes ethane.